As treaties and trade agreements are implemented this year, more U.S. companies are looking at the Association of Southeast Asian Nations for fresh business opportunities. Fortunately, a whole host of logistics and transportation service providers are laying the groundwork to overcome inherent infrastructure challenges.

Today, U.S. trucking companies face more regulations than any time in history—and they claim this “regulatory tsunami” is putting the clamp on U.S. productivity. During this session shippers will gain a better understanding of the current state of trucking regulations (HOS & CSA) and the impact they're having on capacity and rates.

Proposed changes to truck driver Hours-of-Service (HOS) regulations made by the Federal Motor Carrier Safety Administration (FMCSA) in December have created a potential situation in which the amount of time carriers have to move freight could be significantly curtailed, as well as hinder available trucking capacity.

That was the general consensus at a panel discussion moderated by LM at the Transplace Shipper Symposium in Frisco, Texas earlier this month. The panel, which was moderated by LM, also addressed CSA 2010.

Among the proposed HOS changes are:
-lowering the maximum time on-duty within the driving window from 14 hours per day to 13 hours per day;
-for the driving window, the standard driving window would remain at 14 consecutive hours and 16 hours no more than twice per week, with release from duty required at the end of the driving window regardless of length;
-reducing the legal daily driving time from 11 hours to 10 hours although both 10 and 11 hours are both being considered;
-under the current rules there is no limit on consecutive hours of driving, but the new rules would require a minimum 30-minute break after a maximum of 7 hours driving or working in order for a driver to continue driving, among others.

“The question is [with these proposed changes] will it have a substantial impact in our supply chain and ability to serve customers, given what the loss in hours could do,” said Craig Boroughf, director of indirect sourcing and transportation at USG. “We think that it will decrease overall capacity and result in tighter market conditions. Based on our length of haul of less than 300 miles, we think the service implications will be minimal although we will feel the capacity impact and a tighter regulatory environment, too. We are looking at the impacts of these changes on our business model more than whether we agree or disagree with whether they are required.”

Chairman and CEO of Knight Transportation Kevin Knight said it is unfortunate that HOS is the sacrificial lamb to a political agreement with labor unions, where promises were made and HOS is one of the offers made to “give these heavy political contributors something for their money.”

Shippers and carriers are currently operating under a set of rules with proven safety success, whereas the new rules are much more complicated, explained Knight.

“If we deliver freight to certain customers [between 3 p.m.-6 p.m.] at normal delivery times in our industry, which have been designed to beat the traffic, a driver that runs our of hours will have to wait two full days in order to drive again because he happened to be delivering in what is ‘no man’s land’ in this legislation,” said Knight. “We have rules today that are already hard to enforce so wait until they get these. In the end, the good carriers will be penalized, and the carriers that choose not to live by the rules will be encouraged to break the rules and will get away with it.”

Knight said if the proposed rules pass, carriers will deal with them and adapt to them, while they bring more costs and inefficiencies to doing business.

In his comments, Transplace CEO Tom Sanderson urged the audience to take advantage of the FMCSA’s comment period for the proposed HOS rules, which was re-opened by the FMCSA to add four studies pertaining to the relationship between fatigue and driver safety, which will likely push the comment period beyond its original late July deadline.

“With the current rules accident rates per million miles are down, fatalities are down,” said Sanderson. “Arbitrarily choosing to take an hour out of available driving time makes no sense, and the 34-hour restart provision causes these anomalies of incremental lost productivity depending on when you deliver.”

The current HOS rules are measuring productivity and not fatigue, according to Hank Seaton, partner at Seaton & Husk, L.P. in Vienna, Va.

With these proposed rules, Seaton explained the FMCSA is trying to make truck driving into shift work, which is not how an owner-operator operates.

“We are concerned about truck drivers getting rest, not constraining their HOS,” said Seaton. “And when productivity is impacted, shippers will have to pay for that. This will force shippers to go back to the old ideas from the days of regulation in which a driver could show up at anytime during normal business hours and have his truck unloaded in 30 minutes. You are not set to compete with that and unless we get some flexibility with HOS to get off the congested highways to drive when we can, to manipulate the hours of service and get some rest, the burden is going to fall on truck transportation.”

About the Author

Jeff BermanGroup News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. .(JavaScript must be enabled to view this email address).

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